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By Eileen Soreng
(Reuters) - Gold prices were set on Wednesday for a fifth straight monthly drop, as solid U.S. data and hawkish Federal Reserve comments pointing to more interest rate hikes dented the non-yielding metal's appeal.
Spot gold was flat at $1,724.18 per ounce, as of 0541 GMT, trading close to a one-month trough hit on Monday. Bullion has lost 2.3% so far in August.
U.S. gold futures fell 0.1% to $1,735.40.
"The Fed does not have intentions to significantly ease in the near term. Their focus is on inflation and what they want to do is perhaps even create some two-way risks around policy expectations where they're giving a bit less explicit forward guidance," said Ilya Spivak, a currency strategist at DailyFX.
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This contributes to gold's weakness and the U.S. dollar's strength, Spivak added.
The influential chief of the New York Fed said on Tuesday the U.S. central bank will likely need to get its policy rate "somewhat above" 3.5% and keep it there through the end of 2023.
Even though gold is seen as a hedge against inflation, rate hikes raise the opportunity cost of holding bullion while boosting the dollar.
Latest data showing U.S. job openings increased in July and a bigger-than-expected rebound in consumer confidence in August bolstered expectations that the Fed will maintain its aggressive policy stance.
The dollar index dipped 0.2% but was not far from a two-decade peak scaled on Monday. [USD/]
A number of European Central Bank policymakers have also called for swift rate hikes ahead of next week's policy meeting.
Indicative of investor sentiment, holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.4% to 976.26 tonnes on Tuesday.
Spot silver fell 0.1% to $18.48 per ounce and was down 9% for August, its biggest drop since September 2020.
Platinum rose 0.9% to $855.50, but was headed for a near 5% drop for the month. Palladium climbed 1.9% to $2,128.08 per ounce.
(Reporting by Eileen Soreng in Bengaluru; Editing by Subhranshu Sahu and Sherry Jacob-Phillips)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
